Nguyen v Westpac Banking Corporation
[2014] QCA 117
•23 May 2014
SUPREME COURT OF QUEENSLAND
CITATION:
Nguyen v Westpac Banking Corporation [2014] QCA 117
PARTIES:
XUAN THU NGUYEN
(appellant)
v
WESTPAC BANKING CORPORATION
ABN 33 007 457 141
(respondent)FILE NO/S:
Appeal No 8021 of 2013
DC No 2552 of 2013DIVISION:
Court of Appeal
PROCEEDING:
General Civil Appeal
ORIGINATING COURT:
District Court at Brisbane
DELIVERED ON:
23 May 2014
DELIVERED AT:
Brisbane
HEARING DATE:
5 May 2014
JUDGES:
Gotterson and Morrison JJA and Martin J
Separate reasons for judgment of each member of the Court, each concurring as to the orders madeORDERS:
1.Appeal dismissed.
2.Appellant to pay the respondent’s costs of the appeal on the standard basis.
CATCHWORDS:
MORTGAGES – RECEIVERS – POWERS, DUTIES AND LIABILITIES – where the appellant customer had two overdraft facilities with the respondent bank – where the facilities were secured by a mortgage over the appellant’s real property – where the debt balances in the facilities were in excess of their limits – where this constituted a Default Event under the mortgage Schedule – where the appellant submitted that the overdraft limits had been increased – whether the appellant had to deliver up vacant possession of the mortgaged property to the respondent and receiver
State Bank v Lo [2000] NSWSC 1191, applied
COUNSEL:
The appellant appeared on his own behalf
E J Goodwin for the respondentSOLICITORS:
The appellant appeared on his own behalf
Gadens Lawyers for the respondent
GOTTERSON JA: On 30 July 2013, a judge of the District Court at Brisbane granted an application by the respondent to this appeal, Westpac Banking Corporation, which sought an order that the appellant, Xuan Thu Nguyen, deliver up vacant possession of the land at 519 Archerfield Road, Richlands, Queensland (the “property”) to Ms Julie Ann Williams, who was also an applicant in the proceedings but is not a respondent to this appeal. The appellant was ordered to give up possession within 28 days.
The appellant was a farmer and the sole shareholder and director of Queensland Fresh Food Supplies Pty Ltd (“QFFS”). He was the registered proprietor of the property where QFFS carried on a farming business. In February 2010 the appellant applied to the respondent for two overdraft facilities- the first was to the amount of $150,000 and was granted to the appellant personally (the “first facility”), and the second was to the amount of $100,000 and was granted to QFFS (the “second facility”). The first overdraft was secured by a mortgage over the property.
The appellant executed a personal guarantee of performance by QFFS of its obligations under the second facility. [1] On 10 March 2010, the appellant executed a mortgage of the property in favour of the respondent.[2] The mortgage was duly registered. It was security to the respondent for the performance by the appellant of his obligations to the respondent under both the first facility and the guarantee.
[1]AB 162-167.
[2]AB 57-74.
Other than increasing the limit of the second facility to $130,000 in May 2011,[3] the facility agreements continued to run their course. However, later in 2011, the appellant and QFFS allegedly encountered more trying business conditions which adversely affected cashflow.[4] Ultimately, by November 2011, the debt balances in the facilities were in excess of their respective limits.[5] Mr Michael Munt, the employee of the respondent who liaised with the appellant customer, proposed a meeting in January 2012 in order to find a way to clear the arrears.
[3]AB 89-98.
[4]E.g. a demand from a supplier for compensation for loss of pallets, AB 252.
[5]Exhibit 1, Agri Business Overdraft Statement No. 360.
The appellant alleges that the purpose of the meeting was to force him to change from overdraft facilities to a loan. He viewed this as an unnecessary interference with his business[6] and thus cancelled the appointment. Mr Munt’s email which followed noted that there was “… no choice other then (sic) to request you have 28 days to rectify accounts to within approved limits…”[7] The appellant did not do so. On 27 June 2012 the respondent demanded payment by the appellant of $313,414.25 owing to it in respect of the first facility and the guarantee.[8] The appellant failed to comply. The appellant’s failure constituted a Default Event in terms of the Schedule to the mortgage. By virtue of Clause D3 of the Schedule, upon the occurrence of this Default Event, the respondent was entitled both to possession of the property and to appoint a receiver to it.
[6]Although, as the learned primary judge noted, a loan would have been less favourable to the appellant than an overdraft facility- AB 15, Reasons p. 4 LL 10-15.
[7]AB 254.
[8]AB 176.
On 25 February 2013, the respondent appointed Ms Williams as receiver of the property. She was also appointed receiver of the assets of QFFS under a mortgage debenture given by that company in support of the second facility. Ms Williams, by virtue of her appointment, sought possession of the property but was unsuccessful. As a result, the respondent applied to the District Court for the order that was granted.
The appellant, who appears for himself, now seeks to have that order of the learned primary judge overturned. He seeks an order in lieu which would allow him to access his accounts and to continue to service them “as usual”. The appellant’s notice of appeal lists three grounds of appeal. They are that the trial judge erred in failing to find that there had been an increase to the overdraft limit; that Ms Williams caused “terrifying, criminal damage” at the property; and that the valuation of the property at $600,000 was “deceitful [and] misleading.”
A benign interpretation of the first ground of appeal is that the appellant was contending for an error on the part of the learned primary judge in finding that the appellant had defaulted. The appellant sought to establish that the overdraft limits had been increased, so that there would have been no basis for the respondent to claim that either he or QFFS had defaulted. There is no dispute that the second facility was increased to $130,000 on 9 May 2011. However after Mr Munt’s email the facilities were still over their limits, even when the 2011 variation was taken into consideration.[9]
[9]AB 215-226.
There is nothing in the evidence to suggest that the overdraft limits had been increased after 9 May 2011. While there was email correspondence between the appellant and Mr Munt on and around 17 June 2011[10] requesting the respondent to consider an increase, no further action was taken by the appellant in that regard.
[10]AB 257-258.
Each facility agreement clearly states that the facility is repayable on demand. Such a proposition is conventional and consistent with the authorities which confirm the “… proposition that an overdraft, is in the normal course, repayable on demand.”[11] The respondent made demand on the appellant as it was entitled to do. The appellant defaulted and the respondent, as it was also entitled to do, appointed a receiver to the property who sought possession of it on behalf of the respondent. The appellant has failed to demonstrate any error on the part of the learned primary judge in finding the default.
[11]State Bank v Lo [2000] NSWSC 1191 at [26].
Secondly, the appellant alleges that “terrifying, criminal” damage was caused to the property by Ms Williams. There was no evidence to that effect before the learned primary judge. That is not to say that even if there had been it might have had some relevance to the respondent’s entitlement to possession. Unsurprisingly, his Honour made no finding with respect to the matter. This ground is quite unfounded.
Thirdly, the appellant seeks to draw comfort from the valuation of the property at $600,000. The appellant misapprehends the purpose of the valuation. As stated by counsel for the respondent in his written submissions, the valuation of the property went towards establishing that the claim was within the jurisdiction of the District Court. It was not an evidentiary basis from which fraud or deceit on the part of the respondent could possibly be inferred. This ground, too, is unfounded.
In summary, the appellant has failed to demonstrate appealable error on the part of the learned primary judge. None of the grounds of appeal have succeeded. Furthermore, the orders in lieu sought by the appellant are ones which this court does not have jurisdiction to make. Accordingly, the appeal must be dismissed and the appellant must pay the respondent’s costs of it.
Orders
I would propose the following orders:
1. Appeal dismissed.
2. Appellant to pay the respondent’s costs of the appeal on the standard basis.
MORRISON JA: I have had the advantage of reading the reasons of Gotterson JA and I agree with his Honour’s reasons and the orders he proposes.
MARTIN J: I agree with Gotterson JA.
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